If you’ve been leveraging the CMHC MLI Select program to finance multi-unit residential properties, you need to sit up and pay attention. As of February 27, 2025, CMHC has made a major change that will significantly impact how real estate investors structure their deals. The program no longer supports bundled properties on multiple titles, meaning that only properties with a single title are now eligible.
For investors who relied on MLI Select to finance multiple single-family homes, townhouses, or small rental clusters under one application, this is a massive shift. It’s going to change the way deals are structured, the types of properties that qualify for financing, and, ultimately, the strategies investors use moving forward.
So, what does this mean for you? Let’s break it down.
Why CMHC Made This Change
CMHC has been tightening its lending criteria in response to the high demand for MLI Select financing. The program was initially designed to encourage multi-unit rental housing development, but many investors found ways to include smaller properties by bundling them under a single application.
By eliminating eligibility for multi-title properties, CMHC is signaling a clear focus: funding larger, purpose-built rental developments rather than dispersed, smaller holdings. This aligns with the federal government’s goal of increasing rental supply and ensuring financing is directed toward projects that provide long-term affordability.
Additionally, CMHC has been experiencing increased application volumes, leading to delays and resource constraints. The policy change could be a way to streamline applications and ensure funds are directed toward high-density rental properties that have a greater impact on housing availability.
What This Means for Real Estate Investors
Bundling Strategies Are No Longer an Option
For years, some investors used MLI Select to acquire and finance multiple small residential properties under a single umbrella. A portfolio of duplexes, triplexes, or even single-family homes could be grouped together under one application—maximizing financing benefits while spreading risk across multiple properties. That’s no longer possible under the new rules.
A Shift Toward Larger, Single-Title Multi-Unit Properties
With bundled deals off the table, investors will need to focus on properties that meet the new eligibility requirements. That means:
- Apartment buildings with at least five rental units
- Row housing with a single title (not divided into separate ownership units)
- Multi-unit residential conversions where all units are legally contained under one title
If your investment strategy revolved around acquiring and bundling multiple small properties, you’ll need to rethink your approach.
Investors Need More Capital to Scale
One of the biggest advantages of bundling properties was the ability to finance multiple acquisitions under one MLI Select loan, maximizing loan-to-value (LTV) and stretching capital further. Now, investors looking to scale will either need more upfront capital or new financing solutions for properties that no longer qualify under CMHC.
Alternative Financing Will Be Key
For investors who no longer qualify for MLI Select financing under the new rules, alternative lending sources will become more critical, such as:
- Conventional commercial loans (though they often have stricter terms and shorter amortizations)
- Private lenders (which can offer more flexibility but at a higher cost)
- Vendor take-back (VTB) mortgages (where sellers help finance part of the purchase price)
- Joint ventures or syndications (pooling resources with other investors to acquire larger, single-title properties)
Market Adjustments Could Create Opportunities
This change might cause some short-term disruptions in the market. Investors who previously depended on MLI Select for bundled properties may need to sell off holdings, restructure deals, or pivot strategies—which could create buying opportunities for those who are well-prepared.
Multi-unit properties that do qualify under the new single-title rule may see increased demand, as more investors shift toward apartment buildings and row housing under one title.
Additionally, with more investors moving away from smaller-scale investments due to financing limitations, there could be downward pressure on prices for townhouses and smaller rental properties, making them more affordable for individual buyers or cash buyers who don’t need CMHC-backed financing.
How to Pivot Your Investment Strategy
This isn’t the first time CMHC has changed the rules, and it won’t be the last. Smart investors adapt. Here’s how you can stay ahead of the game:
Target Single-Title Multi-Unit Properties
If you were focused on smaller rental properties or bundled portfolios, it might be time to shift toward larger buildings. Look for five or more rental units under one title, which still qualify for MLI Select’s preferred financing terms.
Reassess Your Financing Strategy
Start looking into financing alternatives beyond CMHC. If you’re holding properties that no longer qualify under the program, work with mortgage brokers to find new solutions before your next refinance cycle hits.
Consider Converting Smaller Properties into Multi-Unit Rentals
If you own single-family homes or duplexes that no longer qualify for MLI Select, explore legal conversions into multi-unit properties under one title. This could help you maintain access to CMHC-backed financing.
Look for Undervalued Multi-Unit Properties
As some investors exit the market due to these changes, there may be opportunities to acquire underpriced multi-unit properties that still qualify under the revised MLI Select rules.
Think Long-Term & Stay Informed
This shift is about directing funds toward sustainable, scalable rental housing. If you’re serious about growing your real estate portfolio, staying informed and adjusting your strategy accordingly will be critical.
Explore Municipal Incentives for Multi-Unit Housing
With CMHC prioritizing larger developments, some municipalities may step in to offer additional incentives for investors willing to build or convert properties into rental housing. Keep an eye out for municipal tax breaks, grants, or expedited approvals for projects that align with housing supply goals.
Final Thoughts: Adapt and Thrive
This change to CMHC’s MLI Select program is a big deal, but it’s not the end of the world. Yes, it eliminates a popular strategy for financing small rental properties, but it also reinforces the long-term push toward larger, purpose-built rental housing.
If you were previously focused on bundling smaller properties, it’s time to pivot. Shift your focus to single-title multi-unit investments, explore alternative financing options, and stay ahead of the curve.
At the end of the day, the real estate market will keep evolving. The investors who succeed will be the ones who adapt quickly, plan strategically, and capitalize on new opportunities.
If you’re looking for expert advice on how to navigate these changes, connect with a Savvy Investor Trusted Mortgage Specialist who can help tailor a strategy to your investment goals. Change is inevitable—but with the right moves, it can also be profitable.
